Watching the Muskrat

Shoot the messenger. When you haven’t got the goods to support your own argument, it’s probably the most popular method to deflect attention from your own shortcomings.

That seems to be where we’re heading with the Muskrat Falls debate, adding a whole new layer of waste-of-time to a complex, multi-billion-dollar project that, depending on your perspective, is either a boon or a blowout.

There are those who suggest that the real failing in media coverage of the project has been in the area of investigative journalism; that there has been no single, clear-cut issue involved with Muskrat Falls that would immediately anchor either misgivings or their support.

The thing that always fascinates me about those who call for more investigative reporting is that, invariably, they’ve never really done any themselves.

Why? Because it’s difficult, long-term work involving tonnes of paper or electronic records, all of which has to be reviewed extremely carefully to find the devil in the details. Often, you do hours of dull, particular work uncertain if the devil’s even in there. You cultivate sources with disparate scraps of material that often aren’t even significant to the sources themselves, so that you and they are searching blind.

And it can all leave you empty handed. The fact is, there isn’t always a smoking gun.

But you’d have to lever yourself out of the comfy critic’s armchair to actually realize that, so it’s easier just to sling out innuendo about “work not being done” instead of actually doing a bit yourself.

Reporters and editors at The Telegram have pored over thousands of pages of documents, exhibits and reports on Muskrat Falls — not just in Newfoundland, but with agencies as diverse as Manitoba’s Public Utilities Board and with nuances as delicate as the U.S. Federal Energy Regulatory Commission’s rules on energy transfer.

There’s been work on shale gas and on the declining price of electricity exports to the United States, an examination of what the cost of Muskrat Falls power will really be once it’s delivered to the Avalon — a dizzying amount of complex information.

CBC has done similar work. While Richard Cashin may feel comfortable accusing CBC’s David Cochrane of giving the government an easy ride on Muskrat Falls, I certainly wouldn’t agree. Other CBC reporters have also turned over a large number of rocks trying to find new material on a project that’s been covered to the point that a significant part of the population doesn’t even want to hear about it anymore.

If anything, the problem is that there is too much information available — so much, in fact, that the difficulty is spotting the most significant and realistic problems out there amongst everything else that’s being thrown around.

Is there work still to be done?

Of course. There will be plenty more work, especially when the provincial government finally gets around to releasing the Decision Gate 3 numbers, the newest (and most accurate) financial numbers for the project. There’s also work to be done on a couple of glaring leaps of faith in the current debate — for example, the clearly bogus claim from the government that it doesn’t matter if Muskrat Falls costs go up, because every other cost for every other power source will go up in lockstep.

What makes that such a false trail? Well, because of the two scenarios the provincial government has been willing to fully look at, one demands massive infrastructure investments, while the other’s costs depend on the price of oil. Significant increases in the cost of building a dam and transmission system don’t immediately result in an increase in the price of oil. It’s a hand-waving dismissal of a serious issue.

Likewise, there’s work that could be done examining both Nalcor’s argument that a province with an aging, declining population will necessarily buy more power every year — as well as whether there aren’t significant conservation steps that could squeak the province through to 2041 and cheap Upper Churchill power.

I don’t think it’s correct to say that investigative work isn’t being done.

Comments

Comments

Your name*Email*Comment*

Recent comments

The forgotten issue - mercury, a poison

October 02, 2012 - 19:31

Eat it up Labradorians! That's right - enjoy your country foods (fish, etc.) pumped full of a potent neurotoxin. Flooding of the Muskrat Falls reservoir will directly increase mercury levels in both the reservoir and downstream. This happened with the Upper Churchill (in both the reservoir and all the way into Lake Melville) and it happened with the La Grande in Quebec (both in the reservoir and downstream).
Why this is not receiving media coverage is beyond me... seems more important than dollars and cents - the fundamental human right to a safe and healthy environment. I guess most of the provincial population (i.e. your readership) doesn't actually have a stake in the local impacts (environmental and human health) of Muskrat Falls, hence your lack of coverage of it.
If the media stopped focusing on dollars, they would find their smoking gun.

"Why isn't the media reporting on these things that I heard about in the media???"

Fintip

October 02, 2012 - 17:10

This is a note for Rob who admonishes another poster that "There is a difference between investigative reporting, and searching for evidence to corroborate a pre-determined theory". Not really Rob. Investigative reporting - much like scientific inquiry - by its nature starts with a hypothesis that there is some unexplained, hidden factor to account for an aberration or anomaly. It is a longstanding technique - popularized in modern times by Woodward and Bernstein during Watergate - by which the media, and through it the public, can hold those in power to account for negligence or wrongdoing. Muskrat presents a classic anomaly in that it constitutes a project that, on its face, violates almost all the accepted tenets of economic and business theory. Whether it is examined in an economic context (cost benefit analysis) or subjected to financial modelling (i.e. - a pro forma test of financial viability), Muskrat readily reveals itself as a horrendously poor investment. I doubt there is any truly independent professional in either discipline who would argue that point. The absence of a reasonable return on investment has excluded any interest from private sources of equity and hence raises the question of why the Newfoundland taxpayer should be expected to put its scarce dollars at risk. It is because of NALCOR’s defiance of sound economic logic that that the question is begged - who really stands to gain from this project? Clearly not the taxpayer, the homeowner, the small business, the middle class, the senior or others on fixed income. By the time Muskrat is constructed, each of these groups will find itself paying double what it now pays for electricity. And it only gets worse from there. Because we cannot predict interest rates over its full 57 year amortization and because substantial over-runs are inevitable, we can have no certainty as to the ultimate cost of the project. Hence we are buying a rather expensive pig in a poke. What is already clear from the DG2 numbers is that this project fails to attach any positive value whatsoever to the resource itself. In other words, if this project were considered for private sector investment, its dismal financial parameters would not allow for the return of any economic rent to the owners of the resource - i.e. the public. To meet the threshold return on investment for private sector investorss, we would have to give them the resource for free and even then we would have to pay them a substantial upfront cash incentive or ongoing operational subsidy (e.g. - by way of excessive rates). And so it becomes readily apparent why a for-profit entity like Fortis has absolutely no interest in investing in this project. Moreover the expected escalation of capital costs that will come with the release of the DG3 numbers will only serve to exacerbate this intractable economic conundrum. The question then for independent minded politicians, the public, and the media is why in the face of such economic ugliness would our own Dunderdale government and NALCOR collude to push this project through? A good investigative journalist would therefore start with the premise that there is something here that does not add up. That feeling is only heightened by the extremes to which government has gone to shield pertinent facts and figures not only from the public, but from the very regulatory agency that it charged with the responsibility for evaluating the project. Equally telling is its proclivity - both directly and through anonymous shills like John Smith - for publicly ridiculing and attacking anyone who dares question the merits of the project. Such behaviour only serves to reinforce the growing sense of public doubt whether, in fact, there might be a rat in the Muskrat?

You can buy a high quality, personal wind turbine for a thousand bucks.
If you underestimate the cost of Muskrat Falls at 10 Billion and overestimate the number of Newfoundlanders and Labradorians at 600 000, the cost per person is over 16 000.
The problem isn't lack of information... it's lack of imagination.
p.s.
@ FINTIP -- That's the best analysis I've read in a long time. Well said!

Russell, your item here and the comments suggests that like Charlie Sheen, John Smith may be winning this debate. You say 1. shooting the messenger ( the media) is another layer of waste -of -time. 2. that the media has in fact done a lot of investigative reporting- but so far has no smoking gun- to offer a better alternative than MF- just as John Smith alledges. Now the critics have to rely on their own efforts, where John Smith just quote all those paid consultants of Nalcor's, and their limitless financial resources for this project.3.That there is so much information, it is difficult to spot the significant and realistic problems.4. That it's not over til it's over. 5.There is yet the bogus claim that if MF costs go up, everything else goes up in lock step. 6. There's always the first principle agrument- that the forecast demand has't been suffiiciently proven, as we have an aging and declining population, and last (and therefore least) , maybe significant conservation steps can save the day- Which John Smith calls a "nice idea, but a pipe dream" .In summary, Russell, you say all of this effort is not yet enough, it hasn't led to what some people want to hear. What people want to hear is that there is a better and cheaper and less risky alternative.
Of course you don't even the list my pet topic- efficient heating, and energy efficiency. You may intend it covered under conservation. If so, that puts you in the camp with John Smith on this issue. Now FINTIP ranks efficient heating separately and ahead of conservation. Maggie, Maurice , Cyril and maybe a few others see it as significant. You don't rank it at all, while I would rank it number one. In over a year , not a word from you on efficiency. My feeble efforts got no responce from you- almost . You did say you didn't mean to be silent on this issue. But in effect you challenge critics to do more, more investigative work. That may be fair. On energy efficiency, I hope to boost my views that you may find it worthy to publish. People want to hear there's a better , cheaper , less risky alternative. Need to pass the 'people test'- not sure if that would include John Smith? Part 1 of my 2 part submittal to you is ready for your prepublication review, a letter of about 1100 words, much shorter than my original try at 2000 words. I try to be non technical with a technical matter. Your assistance to edit would be appreciated. Unlike John Smith, I think your writing is very very good. On the issues of efficiency- I'll hold my judgement. Wouldn't want to shoot the messenger. Rather kill that Muskrat, or drive it back it it's hole for 2 or 3 decades.

The Telegram and the CBC both share a journalistic failing that is made all the more conspicuous by virtue of their own histories. There was a time - when the Telegram was owned by the Herder's and when the CBC had a significant regional presence in the province - that the public could count on some in-depth, hard hitting coverage of government policies and decisions. The Telegram's golden era occurred during the late sixties and early seventies when the paper saw fit to lend a hand to the raggedarse artillery that was then the official opposition to the Smallwood dictatorship. Ray Guy personally threw enough well-aimed rocks to knock down a dozen Gambo Goliaths. For its part, the CBC had a highly competent, motivated - at times even aggressive - news and public affairs team. Not only did both institutions engage regularly in investigative reporting (unnamed sources often emanating from the bowels of the Confederation Building itself), but they were equally up to the task of grilling public officials on the record. They were regularly vilified of course for doing so by Smallwood and his henchmen. As Smallwood gave way to Moores who gave way to Peckford and so on, the level of openness and transparency in government increased exponentially. But the democratization of government in this province began to slow and even reverse itself during the Wells administration. The closed shop mentality fostered by Wells (who reduced his senior bureaucracy to a secretarial pool) continued under Williams. This is the model under which Dunderdale learned her trade and one which she was eager to restrict even further as evidenced by Bill 29. The media offered sporadic, half-hearted challenges along the way but were singularly unsuccessful in large measure due to the enormous cut-backs in journalistic resources. Like our lighthouses, the CBC in Newfoundland has become little more than an automated beacon with Here and Now desperately appealing for public feedback to fill the obvious voids in its nightly news content. Both organizations have a few competent journalists - people like Cochrane and Fitzpatrick - but they are spread so thin that it is difficult to do justice to run-of-the-mill stories let alone complex, controversial ones like Muskrat. Indeed both are regularly out-performed by a media that had no great history of journalistic independence - NTV. It's not surprising that with just a little effort the NTV crew has come up the middle and left both CBC and the Telegram in its wake. But what all media lack - and this is not unique to Newfoundland - is the ability or the temerity to follow up an unanswered question with an even harder hitting question. Effectively our politicians have come to expect uncontested, free air-time every time they approach a microphone. Gone is the fear that some crack news reporter will attempt to hold their feet to the fire. This is due in part to the lack of resources but even more so to the absence of a clear mandate from their respective news directors and corporate management. As far as Muskrat is concerned, there is enough blame to go around. It starts with a government that has almost outdone Harper in abusing every precept and principle of parliamentary democracy. It extends to a dull, unenthusiastic, unfocussed - and likely co-opted - opposition. No doubt Ball is struggling to stave off McDonald and Michaels is being up-ended by Harris. Clearly Williams has a foot in all three camps such that the independence of the opposition has been severely compromised. So it’s back to the media. Individuals like Wangersky have done a credible job on the editorial side but less so on the research and reporting front. Where, for example, are the list of questions put to government and NALCOR regarding Muskrat that have been ignored or denied under the cover of retrograde legislation? Isn't there more room for more cooperation between media? What exactly is 2041 Inc doing to flesh out the issues? Why is MUN - with a few notable exceptions - far too quiet on a project that not only threatens our economic future but MUN's own future given what will inevitably become a rationing of finances brought on by Muskrat? No doubt this siphoning of the treasury for one giant unnecessary project will also impact the future outlook for public sector unions in this province. Unfortunately what the Telegram and CBC both lack is a sound base of knowledge in the areas of finance and economics. The art of business reporting in this province is down to press releases, the Board of Trade rubber chicken circuit, and - worse still - the exchange of column space and air time for advertising revenue. Most reporters wouldn't know an IRR if it smacked them up the side of the head. Which is too bad since almost everything of import that happens or could happen in this province has an underpinning in economics and finance. The bottom line for Muskrat is that it will enslave several generations of Newfoundlanders to an onerous financial scheme that will serve the interests of big business while condemning homeowners to what will be unquestionably the highest utility costs in Canada. And, remember, that is in a province with an abundance of natural energy resources. NALCOR and Dunderdale refuse to give any proper consideration to the alternatives to Muskrat because none of those alternatives - natural gas, small head hydro, heating efficiency, conservation, recall, or interprovincial energy transfers - satisfy the special interests that have seized control of our government. Sadly, the onus for mounting any real challenge to this Muskrat boondoggle is down to ordinary citizens, many of whom must post their objections anonymously because there exists a real threat that their ability to earn a living in the real world could easily be compromised by a thin-skinned, arrogant, vindictive government. (With apologies for the length of the post.)

Fintip says it's all a big conspiracy folks...LOL The governemnt has been taken over by the special interests. There are black helicopters flying through the streets of Manhattan, and the Mob killed JFK. Yep Fintip's got it all figured out. keep up the good work conspiracy theorists...you are the best thing the debate FOR muskrat has going for it... LMAO

JM

October 03, 2012 - 06:25

Fintip this is a very good analysis of the state of affairs in the province. Mr. Wades comments in Wednesdays paper is also a very clear sign that even he do not understand the economics of the project. The government are clear that the ratepayers will pay for the entire project. Any revenue from sales to mining, or Emera will not be used to lower the rates, but will be directed to the provincial treasurey. It will increase revenues to the NL government. but through higher electrical rates to the consumer. THIS IS A TAX by another name. The blatent disregard this government has for the rate payers of the province is troubling.

Maurice E. Adams

October 02, 2012 - 11:43

Let me say that as a ratepayer, a father, a grandfather, a citizen, a taxpayer --- (and not a journalist, engineer, lawyer or economist) I have learned what it takes to research, to read, to analyze, to spend many hours and months (now verging on years) to try and understand and to make judgments about this proposed Muskrat Falls project. For shedding light on government's and Nalcor's misleading statements and omissions about Muskrat Falls, I have also learned what is like to be criticized, to be referred to as a 'naysayer', an 'arm-chair critic', a political partisan, a liar, and a fool. ....... Less time should be spent on the messenger and on criticizing and defending the media, and more time, energy and resources spent on critically analyzing and exposing the facts about Muskrat Falls --- and on those who stand to benefit and those who stand to lose.

Please keep this project in the light until it is decided. The decision to procced with this project will have a lasting impact on pocket book of every electricity consuming individual in the province of Newfoundland for the project life. It all boils down to the economics of the project. How do you make a project successful when its cost is three times the cost incurred by power companies on the mainland to produce equivalent hydroelectric power? The province of Quebec has proceeded with its 1500 megawatt Romaine project to deliver export power at $92 per megawatt hour. The Muskrat project appears to be able to deliver power to the mainland grid at a range between $180 per megawatt hour and $270 hour depending ion the capital cost with a range of $7 billion to $ 10 billion.
The subsidy required from the NL public will be in the range of $90 to $180 per megawatt hour. How can any loan guarantee or creative accounting turn such a large discrepancy in favour of this project?

I usually agree with Russell's editorials, but this one is an exception. Firstly, I can say as one who does that extensive investigative work, that it is long and tedious. Many modern media outlets don't have the resources-especially in a small market like NL. That being said, Mr Cashin has a point. While Cochrane has been highly critical of cver,etain government actions, like Bill 29, he often accepts government explanations on Muskrat Falls without much if any scrutiny. Your comments in this post as to the demographics, etc are a few of the obvious ones that those of us who have done the research have been saying for over a year. I believe Cochrane's approach to making Mr Cashin's statements the story, as opposed to the story he was there to cover, show either arrogance or insecurity. The media should not consider themselves above scrutiny. In the end, they are no different than anyone else in society.

Well there is a surprise brad that you agree with Richard Cashin....a liberal partisan. If that 2041 Energy Group wasn't so full of partisan Liberals they might be able to convince someone that their intentions are anything but politically motivated.
The only known (former) Conservative in the group is involved in the oil and gas business...that is certainly one industry that will lose out if we stop burning oil for power.
Anyway, everyone is throwing all these arguments around and we don't even have all the details and cost estimates yet. Still people like you continue to fear monger and push your own political agenda.

Rob

October 02, 2012 - 13:43

Brad:
There is a difference between investigative reporting, and searching for evidence to corroborate a pre-determined theory. Confusing the two is not productive.
Investigative reporting involves searching through data and coming to a conclusion after review.
The other side involves coming to a conclusion, then sifting data to support it.
Russell is bang on when he says, "The fact is, there isn’t always a smoking gun." and "Perhaps it just hasn’t led to what some people want to hear."

Gregory

October 02, 2012 - 09:28

Seems that you feel professionally attacked, Mr. Wangersky. That is not so, at least not from where I sit, because you have been one of the most solid and critical journalists with respect to this project and have been so consistently. Also, you have never been personally singled out from the criticism I have seen and heard. It seems that you don't like some in your profession being challenged and you are sticking up for them and for your profession in general. I don't think that is really necessary. As a citizenry, we must be critical thinkers, and in a democracy, we are allowed to voice disagreement and disapproval of what our politicians do and - yes - what our media does (or doesn't do, in this case), if we see fit. And when the stakes are as high as Muskrat Falls, we'd be falling down on our responsibility as citizens if we sat back and took everything both this government and our media said at face value.

Gee Russell are you complaining about having to do your job? Why don't you try working at a checkout at Walmart for 12 hours a day? maybe you are spending too much time writing about butterflies and rainbows chasing the elusive Giller prize, rather then digging out the truth. The Liberals talk about bringing expert witnesses to the House. Why don't you call up these so called experts up and interview them? How hard could it be? Perhaps it's that you are trying to make the project look worse than it is to sell papers?Perhaps the Tely has taken a decidedly anti muskrat tone because the owners of the Telegram have a direct relationship with Quebec Hydro?As far as the isolated island option goes we will have to invest billions into refurbishing the 30 year old plant in Holyrood, and into building small hydro. Only to find ourselves scrambleing for more power, just a few more years down the road. Of course then the Low interest rates, our credit rating and the loan guarantee, the deal with Emera will all be long gone. A newfie tradition...scuttle a good deal now, and be forced to take the crappy one later on. yep, that sounds about right. Russell perhaps it would be best if you left the investiogative journalism to someone who wants to do it? Not someone who enjoys writing flowery prose like a grade nine student. Investigate the other options fully. Explain to us why a pipeline on the seabed makes no sense, because a rupture would take 6 months to repair, or how the topsides facillities would cost billions to build and maintain, and the oil companies would control it. How it would cost more to convert the old plant at holyrood. How LNG is now being banned around the world as being unsafe to transport. There is lot's to look into...however I think there are many answers you just don't want to find....

Mr. Wangersky, I have generally been of the opinion that the media has not presented the flaws in the government's glib assertions about some of the benefits of Muskrat Falls. However, you and Mr. Meeker are two media people who have questioned many aspects of this project from Day One. I thank you for your valuable contributions to this complex issue! It is not easy to understand but my frustration only increases every time the government makes these simplistic assertions about power increases, with or without Muskrat! These kinds of statements are disingenuous, at best, and simply obscure the important issues surrounding the project.

HBG

Expert Bloggers

Quick question - 03/31/2015

A Corner Brook woman was upset recently when she had her seal skin purse confiscated by customs officials when entering the United States — she was unaware of a U.S. ban on seal product entering that country. Are you aware of the ban?